THE Energy Regulatory Commission (ERC) has provisionally approved the implementation of seven capital-expenditure (capex) projects of the National Grid Corp. of the Philippines (NGCP) for 2016.
These seven projects amount to P1.118 billion.
“The commission hereby provisionally approves the implementation of NGCP’s seven capex for the regulatory year 2016, subject to the optimization based on its actual use and/or implementation during reset process for the next regulatory period following the procedures stated in the Rules for Setting Transmission Wheeling Rates and other relevant issuances of the commission,” the agency said in its 22-page order.
Based on its initial evaluation, the ERC said NGCP’s capex for 2016 is in accordance with the provision of Republic Act 9136 and the “Resolution Amending the Rules for Approval of Regulated Entities’ Capital Expenditure Projects” and will “redound to the benefit of its consumers in terms of continuous, reliable and efficient power supply” to ensure the quality, reliability, security and affordability of the supply of electric power.
These projects include the P200.98-million Tiwi substation upgrading; the P69.69-million Naga substation upgrading; the P58.28-million Clark-Mabiga 69-kilovolt (kv) transmission line; the P359.88-million Bataan 230-kv grid reinforcement; the P19.96-million Hermosa-San Jose transmission line; the P326.80-million revenue metering expansion and security infrastructure project; and the P82.99-million Security Infrastructure project. The ERC said the contract for the supply of materials for the proposed projects will be assigned to qualified suppliers and contractors following a competitive bidding and selection process. The funding will be sourced through NGCP’s internal cash-generated fund. The cost estimates were based on cost per kilometer for the transmission line, which was derived from previous contracts.
NGCP is required to seek prior approval from the ERC of any plan for expansion or improvement of its facilities. Along with its authority and responsibility for the planning, construction and centralized operation and maintenance of its high- voltage transmission facilities, it is indispensible for NGCP to ensure a reliable and high-performance operation of the transmission system.
“One of the core mandates of NGCP is to implement upgrading and expansion programs to ensure the system adequately and reliably meets forecast demand, system reliability, demand market requirements and capacity of new generators,” NGCP said.
NGCP is also required to ensure a reliable and efficient operation of existing transmission line and substation equipment; and to guarantee a safe and reliable energy supply to the distribution utility. To comply with this mandate, NGCP needs to implement, among others, rehabilitation, refurbishment, testing activities to the existing transmission line and substation assets.